There were two spamming scripts installed on the website server. Even after deleting all the files these spamming scripts could not be deleted. It was finally deleted by Hostgator after a few emails back and forth.
I have been recommending Roboform in couple of posts. There a free version and a Pro version. The Pro version has more functions and I purchased it couple of months. I did try the free version before I purchased.
I have changed the passwords of all my sites after this experience. Just to be on the safe side. I will be paying special attention to online security from now on. If this had not been detected and fixed the domain could have been de listed. Then it is a bit of a time & process to get it listed again. I would not want this to happen to a large site that produces income for me.